It’s All About the Benjamins! EditTools’ Time Tracker (Part I)

By Richard Adin

In the early years of my freelance editing career, I joined the EFA (Editorial Freelancers Association) as a way to “meet,” via its chat list, other freelance editors. One thing that struck me was how united — except for me and a very few others — EFA members were in their approach to the business of editing. We outliers viewed our chosen career as a business, while most of our colleagues viewed what they did as more like art; that is, they paid as little attention as possible to the business side of freelancing and as much as possible to the skill (editorial) side.

There were many discussions about financial struggles, poor pay, added tasks, multiple passes, and the like. There were few discussions (and very few discussants) regarding advertising, promotion, business practices, calculating what to charge, negotiating — any of the business-side skills. And when business-oriented discussions did start, they often ended quickly because colleagues piled on about how craft was so much more important than something as pedestrian as business and money.

As I said, I was an outlier. For me, it was about the Benjamins (the money). Freelancing was my full-time job — my only source of income. I had a mortgage to pay and two children to feed, clothe, keep healthy, and school. I had no trust fund or wealthy relative who couldn’t wait to send me money on a regular basis. Although how well I edited was very important to both myself and my clients, the money was equally important to me.

I recognized from the start that if I didn’t pay close attention to the business side of freelancing, my family and I would be in trouble. When my son needed $5,000 worth of dental work, it was my job to make sure he got it. It was not my job to tell the dentist, “Sorry, but I am an artisan without sufficient income to pay for your services.” When it came time for college, it was my job to try to get my children through with minimal or no debt for them to deal with upon graduation. And this doesn’t even address such things as providing for my retirement or providing health insurance and auto insurance and the myriad other things that are part of modern life.

In other words, for me, it was all about the Benjamins in the sense that my editorial work could not be viewed through rose-colored glasses as if the only thing that mattered was artisanship.

Which brings me to the point of this essay: EditTools 9 and the project management macros that are part of the just-released EditTools 9 (www.wordsnSync.com).

In Business, Data Drive Success

What seems a lifetime ago, I wrote a series of essays for An American Editor about calculating pricing and why it is important not to look at rate surveys or ask colleagues for guidance (see, for example, the five-part essay “What to Charge,” beginning with Part I, and “The Quest for Rate Charts.” ) Yet, when I go to chat lists like Copyediting-l, it is not unusual to find colleagues asking “What should I charge?” or “What is the going rate?” Nor is it unusual to see a multitude of responses, not one of which is really informative or meaningful for the person who asked the question.

When I meet or speak with colleagues and these questions come up, I usually ask if they have read my essays (some yes, some no) and have ever actually gathered the data from their own experiences and used that data to calculate their personal required Effective Hourly Rate (rEHR) and their actual EHR, both for a project and over the course of many projects. Nearly universally, the answer to the latter questions (about data collection, rEHR, and EHR) is “no.” Why? Because “it is too much effort” or “the XYZ rate chart says to charge X amount” or “I can’t charge more than the going rate.”

But here are the problems: If you don’t collect the data,

• you can’t determine what you are actually earning (as opposed to what you are charging; you can be charging $3 per page but actually earning $45 per hour, or you can be charging $5 per page but actually earning $9.25 per hour);
• you can’t know what is the best way to charge to maximize your EHR for the kind of projects you do;
• you can’t determine whether some types of work are more profitable for you than other types; and
• you can’t easily determine what to bid/quote when asked for a bid/quote for a new project.

Ultimately, if you don’t know your rEHR, you don’t know if you are making money or losing money because you have nothing to compare your EHR against.

It is also important to remember that there are basically two ways to charge: by the hour or not by the hour (per word, per page, per project). Although many editors like to charge by the hour, that is the worst choice because whatever hourly rate you set, that is the most you can earn. In addition, it is not unusual to start a project and suddenly find that it is taking you less time — or more — to work than originally expected. If you charge by the hour and it takes less time than originally thought, you lose some of the revenue you were expecting to earn; if it takes more time, and assuming nothing has changed, such as the client making additional demands, you run up against the client’s budget. I have yet to meet a client with an unlimited budget and who doesn’t rebel against the idea that you quoted 100 hours of work but now say it will take 150 hours and expect the client to pay for the additional 50 hours.

However, to charge by something other than the hour requires past data so you can have some certainty, based on that past experience, that you can earn at least your rEHR and preferably a much-higher EHR. The way it works is this:

If you charge $3 per page for a 500-page project, you know you will be paid $1,500. If your rEHR is $30, you also know that you have to complete the job in no more than 50 hours. If you can complete the job in 40 hours, the client still pays $1,500 because the fee is not tied to the time spent but to the page count, and your EHR is $37.50. If you were charging by the hour and charged your rEHR of $30, you would be paid $1,200 — a $300 revenue loss.

All of this is based on knowing your data. During my years as a freelancer, I accumulated reams of data. The data were not always well-organized or easy to access until I got smarter about how track the information, but it was always valuable. Within months of first collecting data, I learned some valuable things about my business. I learned, among many other things, that for me (I emphasize that this applies solely to me and my experience):

• medical textbooks earned a higher EHR than any other type of project;
• charging by the page was better than charging hourly;
• calculating a page by number of characters rather than words was better;
• high-page-count projects that took months to complete were better than low-page-count projects (I rarely edited books of fewer than 3,000 manuscript pages and usually edited texts ranging between 5,000 and 7,500 manuscript pages; I often edited books that ran between 15,000 and 20,000+ manuscript pages);
• working directly with an author was highly problematic and to be avoided;
• limiting my services to copyediting was best (I phased out proofreading and other services);
• working only with clients who would meet my payment schedule was best;
• saying no, even to a regular, long-time client, was better for business than saying yes and not doing a topnotch job because I hated the work.

I also learned that investing in my business, such as spending many thousands of dollars to create and improve EditTools, paid dividends over the long term (the more-important term).

And I learned a lesson that many editors don’t want to accept: that sometimes you lose money on a project, but that is no reason not to try again. Too many editors have told me that when they have charged by a non-hourly method, they lost money, so they returned to hourly charging. How they know they lost money, I do not know, because they had no idea what their rEHR was, but their assumption was that if they earned less than they would have had they charged by the hour, they lost money. This is not only incorrect thinking, it is short-term thinking.

Such decisions have to be made based on data. Because collecting and analyzing accurate data is a stumbling block for many editors, EditTools 9 includes the Time Tracker project management macro, discussion of which will begin in Part 2 of this essay.

Richard (Rich) Adin is the founder of the An American Editor blog, author of The Business of Editing, owner of wordsnSync, and creator/owner of EditTools.

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On the Basics: Dealing with the Perennial Question of Setting Rates for Our Work

Dealing with the Perennial Question
of Setting Rates for Our Work

by Ruth E. Thaler-Carter

Whether you’re a writer, an editor, or any other publishing professional, coming up with rates for your work is a constant challenge. We’ve talked about this before and we’ll be talking about it throughout this millennium and into the next one, but it’s always worth discussing, simply because it is a constant concern. Even established writers and editors have to struggle with this challenge, thanks to the continually evolving world of online communications, bidding websites or services, efforts by professional associations, self-publishing, newcomers to the trade, and more.

How to Charge

Publications usually pay for writing by the word and, equally usually, those rates are determined by the editor or publication. There rarely is much room to negotiate, but you might be able to push up a rate by demonstrating expertise on a given topic, general experience and a publishing history, and good old chutzpah. Some publications will increase the pay rate as you become more known and valuable to them, starting you out at the low end until they know you’ll produce the quality they need and meet the deadlines they set, and raising your rate as the relationship continues.

Some writers will accept a lower per-word rate than usual in return for a guarantee of ongoing assignments from a publication. Certainty can be a big factor in negotiating rates.

It also can be possible to justify a low per-word rate by how quickly you can wrap up an assignment. You might usually get $1 a word for magazine assignments, but really want to write up a certain topic or get into the pages of a certain magazine that doesn’t pay that rate. If you can dash off a 1,500-word article at 15 cents a word, research included, in an hour, you just made $225 for that hour. If it takes two hours, that’s still more than $100 an hour. That per-word amount is ridiculously low, but the assignment or project rate is quite respectable.

It gets more complicated for editing work. As you may recall from other discussions here about rates, editors (and proofreaders) might be paid by the word, page, hour, or project. Even by the character.

Keep in mind, by the way, that charging by the hour could work against you as you become faster and more proficient or efficient — the faster you do the work, the fewer hours you work, the less money you earn. By charging by the character, word, or page, you can increase income as you increase proficiency and speed because you get more done every hour. If you charge by the hour, you actually lose money by working faster and more efficiently, because you have fewer hours to charge for. More hours to spend on other projects, of course, but not more profit from any individual project.

As Rich Adin has discussed in a previous post (see Business of Editing: The Quest for Rate Charts), membership organizations like the Editorial Freelancers Association (EFA) provide some publicly available guidance on rates based on what some of their members report, but those resources can be as problematic as they are helpful. There’s nothing wrong with sharing them with clients who haven’t worked with writers or editors before, but they shouldn’t be treated as the only option or as mandatory. Quote them with clients who offer rates that are lower than you accept if they support your preferences, and feel free to point out that they’re only guidelines when you want to charge more than such a chart shows, even at its higher ends of ranges. See below for some suggestions on “defending” the rates you want to charge.

Some organizations — the Editors Association of Canada is one — provide member-only rates information. That’s helpful in setting fees while reducing the number of prospective clients who might say things like, “But the EFA/EAC/whatever chart says this kind of work should only pay $X/hour, so why do you want me to pay you $X-times-2?” but it doesn’t help educate clients who try to pay ridiculously low rates.

Defending What You Charge

Once you figure out what you think you should charge, be prepared to defend that decision with some clients.

There will always be clients who try to bargain us down to lower rates for our work. You may have to explain the value that you bring to the client’s project — your years of training and experience, your skill level, your subject knowledge if appropriate; in short, why you’re worth what you charge. Not defensively, but from a position of confidence in that worth.

I tell prospective clients that my rates are based on my skills, experience, speed, and wide-ranging knowledge base. I don’t mention my need to pay my bills and cover my expenses; it’s too easy to let such “defenses” look whiny and unbusiness-like. I focus on why I’m a great match for that project or client. If that doesn’t work, I let it go. Life is too short to spend time on haggling over pay rates.

Sometimes you have to brace yourself to stand tough and tall about your rates. You probably will encounter prospective clients who say they can find someone less expensive. Fine. Don’t let them bully you into cutting your rate. Clients who try to bargain you down to less than you think you should be paid are likely to be headaches on other aspects of working together, including getting paid at all. Wish them luck, tell them you may still be available if the less-expensive options don’t work out — and consider increasing your quoted rate if they do come back to you because the cheaper editor turned out to be less than stellar at doing the actual work. (For another perspective, see Business of Editing: “I Can Get It Cheaper!”)

Of course, it’s always easier to hold the line on rates if you aren’t desperate for work. That’s why it helps to maintain a savings cushion, if at all possible, because when we’re desperate, we cave.

To Post or Not to Post

A tangent to the vexing question of what, how much, and how to charge is whether to publicize your rates once you decide what they should be.

The advantage of posting your rates at your website or creating a rate card that you can send to prospective clients is that the information is up and visible, and “tire-kickers” won’t bother you if your rates are too high for them. The disadvantage is that some clients who might be worth working for won’t contact you for the same reason, and some who would pay more than you expect will only offer what you post. By posting your rates, you lose your flexibility and ability to negotiate.

Many of us prefer not to post our rates because we like the option of negotiating payment client by client, even if doing so might involve more work each time. That’s certainly my preference. By not posting my rates, I can charge what I think a project is worth — or my time and skills for that project. I can charge some clients more and some clients less, depending on the nature of project or the client. I can benefit from a client with deep pockets and negotiate with one on a more limited budget.

Pressure to reduce our fees won’t go away. Neither will competition from newcomers, or clients with lowball rates, or websites where you bid for projects and are hired based on how little money you’ll accept. Beyond figuring out what we need to comfortably cover our expenses and administrative costs, as Rich Adin has often proposed (see, e.g., Business of Editing: What to Charge), we have to decide on our value and stand up for it.

Here’s to success in getting paid what you need and think you’re worth!

Ruth E. Thaler-Carter is an award-winning freelance writer, editor, proofreader, desktop publisher, and speaker whose motto is “I can write about anything!”® She is also the owner of Communication Central, author of the Freelance Basics blog for the Society for Technical Communication, and a regular contributor to An American Editor.

Related An American Editor  essays:

• On the Basics: Questions to Ask for the Ideal Client–Freelancer “Marriage”